Little stock being put in imminent recovery
NEW YORK — Investors will be looking for guidance this week as a lineup of top media and showbiz CEOs, including Disney chairman Michael Eisner, are scheduled to be present at a Goldman Sachs conference in New York this week.
Stocks can’t seem to make headway as investors worry that a weak economic recovery could slip back into a feared “double-dip” recession.
They need it. Early last week, the Dow hit a four-year low and the Nasdaq plumbed its lowest level in six years. Economic indicators have become weekly opportunities to evaluate the markets. This week’s key stats will include U.S. manufacturing and employment, car sales and consumer spending. The strength — or weakness — of the economy often dictates advertising spending, the lifeblood of many media companies.
Also last week, the International Monetary Fund cut its estimate for U.S. GDP growth for this year and next.
As the quarter draws to a close, analysts are skeptical that a number of companies, including giant NBC parent General Electric, will meet projected earnings.
Media shares dipped Friday as a rocky September draws to a close. It’s likely to be the market’s worst month of trading in four years as the economy sends mixed signals, companies warn of lower quarterly earnings and the threat of war escalates.
The Dow Jones Industrial Average fell 295 points, or 3.7%, to 7,701. Walt Disney led showbiz shares down, falling 4.14% to $15.24. An upbeat perf from ABC’s new fall sked and humming homevideo sales was offset by news late in the week that the Mouse lost a key theme park exec to the Gap.
Viacom eased 2.37% to $42.48. News Corp. dipped 2.14% to $19.62 and Vivendi Universal was down 2.9% to $12.40 as the two try to wrap up a €1 billion ($981 million) Italian pay TV deal. European competition czar Mario Monti may have prolonged the process, noting over the weekend that the two companies will need EU approval, along with a greenlight from Italian regulators, to complete the sale of Viv U’s Telepiu to News Corp.’s Stream.
Only AOL Time Warner bucked the downtrend, firming 1.76% to $12.12. Another former America Online exec has been implicated in an investigation in questionable accounting at the Internet service provider.